Page 9 - GLNG Week 41

GLNG AMERICAS GLNG
All Elba Island units to be in service by mid-2020
PROJECTS & COMPANIES
KINDER Morgan has said it expects all units at its Elba Island LNG export terminal – which was reported to have entered commercial service last week after several delays – are due to be opera- tional by the first half of 2020.
The 2.5mn tonne per year (tpy) Elba Island facility in Georgia, in the south-eastern US, comprises 10 units, each with a capacity of 0.25mn tpy. Its design is markedly different from the mega-projects coming online on the Gulf Coast, where a single train at an export termi- nal can have a capacity of 5mn tpy. Royal Dutch Shell’s Moveable Modular Liquefaction System (MMLS) small-scale LNG technology has been implemented at Elba Island. Shell is also the sole offtaker for the project, and has a contract to buy its output over a 20-year period.
One unit was reported to have been brought into service last week, and Kinder Morgan’s CEO, Steven Kean, said on an October 16 earn- ings call that three more units would come online this year. The other six are anticipated to
start up in the first half of next year.
Kean described the periodic delays during
the plant’s commissioning process since late last year as being “a drag on our financial perfor- mance”. Kinder Morgan’s chief financial officer, David Michaels, said the company expected to end 2019 with adjusted pre-tax earnings 3% below its budget, with the delays contributing to this.
Kinder Morgan also recently brought the Gulf Coast Express pipeline online. The pipeline carries gas from the Permian Basin to the Gulf Coast, where it can be used as feedstock for LNG terminals, among other uses. Kinder Morgan is developing another pipeline of the same capac- ity – the Permian Highway project. But Kean said commercial activity to develop the project had slowed and the company still needed to obtain certain regulatory approvals. As a result, the pipeline is now predicted to start up in early 2021, instead of the fourth quarter of 2020 as pre- viously anticipated.™
ASIA
China’s gas demand to slow this year
PERFORMANCE
CHINA’Sstate-runSinopecGashasforecastthat the country’s natural gas demand will expand by 10% this year to 307bn cubic metres.
This year’s anticipated growth rate is a marked drop from the roughly 18% jump witnessed in 2018, when the country consumed 280 bcm of gas.
“Due to the macroeconomic situation and the government’s easing [of its] push to the coal- to-gas programme, China’s gas consumption growth is slowing,” Reuters quoted a company spokesperson as saying. The newswire noted that the official was reading prepared comments on behalf of Sinopec Gas’ deputy chief economist, Wu Gangqiang. “We expect the consumption growth for this year is around 10%.”
Sinopec Gas expects national gas demand to climb to 510 bcm by 2030, with the city gas, industrial and gas-powered utility sectors driving consumption. The official said city gas demand was predicted to grow rapidly over the next 10-15 years driven by the country’s ongoing urbanisation. City gas consumption stood at 92.5 bcm in 2018.
Sinopec Gas also anticipates industrial demand rising from 110.6 bcm last year as the government introduces more stringent environ- mental measures. Gas is unlikely to challenge
coalinthepowersectoranytimesoon,withthe company pointing to the high cost of gas as a feedstock as well as shrinking government sub- sidies. Utilities’ gas demand stood 48.4 bcm.
Domestic production is forecast to amount to about 175 bcm this year, with shale gas account- ing for 15 bcm of that figure, Reuters quoted Ministry of Natural Resources research official Pan Jiping as saying. These figures should lead to a 132 bcm gap in supply, which will have to be filled with imports, up from 124.7 bcm in 2018.
Although the country has been expanding its overland import options, in the short to medium term any expansion in imports will likely be met by increased shipments of liquefied natural gas (LNG), and companies are already looking to take advantage.
Private investors
Reuters quoted unnamed sources on October 15 as saying that Yantai Port Group intended to launch two LNG storage facilities by 2022.
The sources added that the company expected the government to approve the pro- jects, which are being built in partnership with affiliate Yantai LNG Group, this month. Yantai LNG will hold a 19% stake in the project.
Land reclamation for the two facilities, which
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